Banks’ digital uptick has unforeseen consequences
Because of Covid-19, bank customers switched to digital banking. At first sight, it’s a big win with cash handling through ATM usage halved; contactless and online payment usage skyrocketing; and a switch away from overwhelmed call centres and restricted branch access to apps.
However, their Internet banking and mobile banking apps are basic, with little ability to interact with their customers to get to know them and understand what they need beyond regulatory KYC compliance.
This causes me to think that this rapid shift poses a risk of banks losing relevance to their customers.
Being relevant requires you to:
appreciate their value to you;
understand them as an individual;
anticipate that they need;
be available to help;
be on their side without nannying them;
leave them in control.
Being relevant also means that banks need to rethink how their products solve their customers’ 21st Century ‘post Covid-19 real-world’ problems. I’ll discuss this in another post.
The payback for the bank being relevant is that it builds a deeper relationship with its customers that creates sustainable value.